(Bond Value) MMM Company borrows money through a bond issue with a $1,000 par value and a 9% annual coupon interest rate, semiannual payments, and maturity of five years. What price should someone who requires an 8% annual rate of return (yield to maturity) be willing to pay for one of these bonds? (The semi-annual payment schedule is important to the computation.) Hint: use the Basic Time Value of Money table attached to this quiz or a financial calculator.

• A. $1,040.55
• B. $990.83
• C. $1,009.26
• D. $1,125.56
• E. $1,254.64